• A £2bn deal to acquire the UK altnet could be formally announced this week, reports the FT
• Telefónica, Liberty Global and InfraVia Capital have once again joined forces 
• A successful deal would create a bigger rival to BT’s Openreach and disrupt the M&A ambitions of CityFibre 

Telefónica and Liberty Global, the two companies that between them own UK telco Virgin Media O2 (VMO2), along with Paris-based private equity outfit InfraVia Capital are closing in on a £2bn deal to acquire major UK fibre broadband ‘altnet’ Netomnia, according to reports. 

Telefónica, Liberty Global and InfraVia are already investment partners in UK wholesale fibre broadband network operator Nexfibre, which is working very closely with VMO2 on fibre access network rollouts across the UK: Nexfibre would be the vehicle for any acquisition of Netomnia. 

It has long been reported that Netomnia has been attracting takeover interest from multiple UK broadband players, with VMO2 and its parent companies identified last October as a very interested party.

Now the Financial Times (subscription required) has reported that the Telefónica, Liberty Global and InfraVia consortium is close to finalising an acquisition and that a deal could be announced as soon as this week. 

If a deal is struck and it doesn't encounter any regulatory hurdles – it seems unlikely that the Competition and Markets Authority (CMA) or telecom regulator Ofcom would raise any red flags – it would be significant for the UK broadband sector, which has many players but few that boast scale. 

Netomnia, one of the UK altnet sector’s few success stories, ended 2025 with a network that reaches more than 3 million premises (up by 970,000 last year) and with 445,000 premises connected for service, having added 207,000 new customers during the course of last year. Its current plan is to expand its network to reach 5 million premises by 2027 and have a customer base of 1 million by 2028. The company generated revenues of £104m, up 168% year on year, and adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) of £5m, compared with a loss of £29m in 2024. But, like many UK altnets, Netomnia has a significant debt pile – its net debt currently stands at £905m, as this infographic shows.  

Nexfibre’s wholesale fibre network, which is being built in areas where VMO2 is not rolling out its fibre access network infrastructure, passes about 2.5 million premises and currently counts VMO2 as its only major ISP customer. 

While there is some rollout overlap between Nexfibre and Netomnia, combining the two would create a bigger single wholesale player that could attract more ISP customers and would strengthen VMO2’s customer base (as it would take on Netomnia’s consumer customers) as well as broaden VMO2’s marketing reach. 

Deutsche Bank analyst Robert Grindle told the Financial Times that the acquisition of Netomnia would increase the scale and reach of Nexfibre “by more than doubling its [network] footprint”, while enabling VMO2 “to sell on a much larger Nexfibre network” as well as its own extensive fixed broadband network infrastructure, which reaches more than 16 million UK premises (of which about 5.5 million are reached with fibre). 

It’s interesting to note that news of an impending deal comes only a day after Telefónica announced it is opening a UK office in London so it can be “closer” to VMO2. 

Such a deal would also give Nexfibre and its owners a tricky and costly integration challenge, of course, but such problems are currently only theoretical and a long way down the line – “sufficient unto the day” and all that.

A Nexfibre/Netomnia combination would also create a more formidable rival to Openreach, BT Group’s quasi-autonomous wholesale fixed access network operation that passes 21 million UK premises with its fibre network and boasts BT’s retail operations as well as ISPs such as Sky and TalkTalk as major customers.   

It would also provide greater competition for wholesale fibre access network operator CityFibre, the UK’s largest altnet (4.5 million premises passed) that is looking to gain greater scale though M&A activity and has also been linked to a potential takeover bid for Netomnia. Could CityFibre possibly make a better offer to Netomnia’s three main investors (Advencap, DigitalBridge and Soho Square Capital)?

Consolidation in the UK’s altnet sector is accelerating. Many companies are saddled with huge debts that they struggle to service and, despite their ability to poach subscribers from the likes of BT, VMO2 and VodafoneThree, the number of broadband customers switching to the altnet providers have been too small to alleviate their financial pressures. The hard commercial reality is that most altnets are simply not big enough to compete in the long term and will either have to be acquired or go to the wall.

– Martyn Warwick, Editor in Chief, TelecomTV